Exam 11: Ordinary Simple Annuities

Suppose $726.56 is deposited at the end of every six months into an account earning 6.45% compounded semi-annually. If the balance in the account four years after the last deposit is to be $31 300.00, how many deposits are needed?

A $15000.00 loan requires payments at the end of each month for five years. If the interest rate on the loan is 12% compounded monthly, calculate the size of each payment.

Mr. and Mrs. Fox have each contributed $1825.00 per year for the last eight years into RRSP accounts earning 6.93% compounded annually. Suppose they leave their accumulated contributions for another five years in the RRSP at the same rate of interest. a) How much will Mr. and Mrs. Fox have in total in their RRSP accounts? b) How much did the Fox's contribute? c) How much will be interest?

What is the nominal rate of interest on a loan of $6800.00 repaid in semi-annual installments of $1175.00 in six years?

How much interest is included in the accumulated value of $4750 paid at the end of every six months for 4.5 years if the interest rate is 8.5% compounded semi-annually?

A trust fund is set up to make payments of $1320.00 at the end of each month for seven years. Interest on the fund is 7.28% compounded monthly. a) How much money must be deposited into the fund? b) How much will be paid out of the fund? c) How much interest is earned by the fund?

Jason deposited $100.00 at the end of each month for five years into an account paying 6% compounded monthly. What will be the balance in the account at the end of the five-year term?

Note: The calculations for this question were done using Excel's RATE function. What nominal rate of interest is paid on quarterly RRSP contributions of $573.00 made for 17.75 years if the balance just after the last contribution is $106 000.00?

Note: The calculations for this question were done using Excel's RATE function. What is the effective annual rate of interest on a loan of $9200.00 repaid in semi-annual installments of $810.00 in nine years?

An annuity due is an annuity for which

How much interest is included in the accumulated value of $250 paid at the end of every month for 5 years if the interest rate is 4.0% compounded monthly?

A $5000.00 loan requires payments at the end of each quarter for five years. If the interest rate on the loan is 8% compounded quarterly, calculate the size of each payment.

How many quarterly payments will it take for $400.00 deposited at the end of each quarter to amount to $11453.40 at 6% compounded quarterly?

An installment contract for the purchase of a computer requires payments of $30.00 at the end of each month for the next three years. Suppose interest is 18.00% p.a. compounded monthly. a) What is the amount financed? b) How much is the interest cost?

Compute the nominal annual rate of interest (compounded monthly) at which $200.00 deposited at the end of each month for ten years will amount to $30 000.00

If a loan was repaid by quarterly payments of $715.00 over 7 years at 8.36% compounded quarterly, how much money had been borrowed?